CFOs must decode data to fuel the next wave of growth

CFOs have more data at their fingertips than anyone else in their company. The process of extracting value from diverse data sets is not simple, but it's exactly how CFOs expect new insights to emerge. To get it right, they must overcome significant barriers in capturing data, adopting new technologies and deploying talent in new ways. The upshot is an accelerated growth strategy and improved efficiency across their entire organization. Here's how:

Driving value from data

Data holds the potential to transform the entire finance function from transactional to strategic and proactive. By capturing and pulling insights from data, organizations will be empowered to increase operational efficiency and efficacy to drive sustainable business outcomes — a trend that will continue to play a huge part in the CFO’s role through 2020 and beyond.

However, 50 to 90 percent of data is unstructured and inaccessible, making the ability to locate the right data a significant challenge, according to a recent Accenture survey. Having access to the right kind of data and the ability to extract it is essential as it creates “one version of the truth.” Without that consistency, 76 percent of CFOs agree that their organization will struggle to meet its objectives.

The findings also indicate that finance functions are already using a variety of emerging tools — like artificial intelligence, robotic process automation and predictive analytics — to better extract, compile and interpret data, all in real-time. These tools help the finance function improve forecasting accuracy, reduce the planning and budgeting cycle, and drive long-range planning initiatives. This technology also enables faster responses on things like return on investment and cash position, while also measuring impact. Ultimately, this leads to key insights that improve organizational performance and growth.

For example, take a leading logistics company that wanted to improve process efficiencies and overall productivity. Their goal? To become a top performer in terms of cost management, cash flow, financial controls and finance talent management. How did they accomplish this goal? The company implemented an intelligent operating model that automated credit and collection workflows and applied machine learning tools to create a new shared services model to centralize processes and bolster compliance. In return, they reduced invoice processing time from 15 days to one, decreased past-due accounts receivable from 29 to 12 percent, and improved cash flow by $53 million. Meanwhile, process cycle time dropped between 50 to 75 percent across the board, helping them gain more than $5 million in profit and loss savings.

Leading with technology

Today’s CFOs are charged with investing in emerging technologies to generate real-time insights that deliver breakthrough outcomes. An Accenture report shows 77 percent of CFOs are already heading up efforts to improve efficiency and achieve growth objectives through tech adoption, while also exploring tools like RPA, advanced analytics and AI to automate the 60 to 80 percent of manual accounting activities with limited or no human intervention. In turn, this frees up CFOs to focus on building roadmaps for responding to vital insights. It also gives them more flexibility, resources and time to identify opportunities for adding value and developing future strategies. The rapid reshaping of the CFO role — from a historical auditor to a strategic advisor — explains why CFOs expect machines will perform less than 50 percent of all finance tasks by 2021.

Implementing automated technologies also means more transparency and improved communications internally. Executives and department heads no longer have to report back to the CFO. With cloud-based tools at their fingertips, employees can easily access, share and analyze critical financial data to optimize working capital and manage revenue, expenses and cash flow. This changes a dynamic that has been upheld for decades.

The result? More time and resources across the organization to deliver better experiences, improve operations and innovate. And as the CFO role is evolving to meet new demands, so are finance talent pools.

Building talent and new ways of working

As new, innovative technologies continue to be implemented across organizations, the responsibilities within the workforce will change. CFOs will need an intelligent finance function, with talent skilled in historical financial analysis (which today takes up to 75 percent of their time) and the know-how to turn real-time insights into viable business strategies. These employees must be quick to adapt and have a wide range of capabilities from data visualization to flexible thinking. The ability to thrive in a culture that champions rapid innovation and new ways of working will also be vital.

By reimagining finance, CFOs can help their organizations prepare for a changing world and fuel business growth. But they can’t do it alone. Change commands deeper collaboration, new ecosystem partners, harmonized platforms and advanced data-driven insights. To succeed, CFOs must become change agents within and beyond finance: smashing silos, building skills and, ultimately, disrupting by example.